The Philip­pine Stock Ex­change Inc. (PSE) has adopted mea­sures to en­sure that it will re­main com­pli­ant with the pre­scribed own­er­ship limit on its shares.

The Se­cu­ri­ties Reg­u­la­tion Code (SRC) man­dates that no in­dus­try or busi­ness may ben­e­fi­cially own or con­trol, di­rectly or in­di­rectly, more than 20 per­cent of the vot­ing rights of the ex­change.

“We in­tend to ob­serve the pre­scribed bro­ker own­er­ship limit in PSE by putting in place safe­guards that will help us with this goal,” said PSE pres­i­dent and chief ex­ec­u­tive of­fi­cer Ra­mon S. Mon­zon.

Among the mea­sures in place are real-time bro­ker own­er­ship mon­i­tor­ing through the trad­ing sys­tem, up­dat­ing of cus­tomer ac­count in­for­ma­tion form of clients of stock­bro­ker­age firms, sub­mis­sion of a monthly cer­ti­fi­ca­tion of trad­ing par­tic­i­pant’s (TP) re­lated per­son ac­counts with cor­re­spond­ing PSE share­hold­ings, and amend­ing the PSE rules gov­ern­ing trad­ing rights and trad­ing par­tic­i­pants.

The ex­change con­fig­ured its trad­ing sys­tem to au­to­mat­i­cally pre­vent the post­ing of a buy or­der for PSE shares from ac­counts that will push it over the 20 per­cent thresh­old, or if it is still below 20 per­cent but the match­ing of the buy or­der will cause bro­ker in­dus­try own­er­ship to breach the 20 per­cent level.

The PSE also re­quires stock bro­ker­age firms to up­date their cus­tomer ac­count in­for­ma­tion form to dis­close the re­la­tion­ship of clients to other trad­ing par­tic­i­pants, i.e., the di­rec­tors, of­fi­cers and prin­ci­pal stock­hold­ers of other bro­ker deal­ers.

As pre­scribed by the Se­cu­ri­ties and Ex­change Com­mis­sion rules gov­ern­ing the trad­ing of PSE shares, the ac­counts to be mon­i­tored in­clude the ac­counts of re­lated per­sons of bro­ker deal- ers, which in­clude their sub­sidiaries and af­fil­i­ates, di­rec­tors, of­fi­cers, prin­ci­pal stock­hold­ers, and nom­i­nees to the PSE and the spouses and rel­a­tives of the fore­go­ing up to the fourth civil de­gree of con­san­guin­ity or affin­ity.

The ex­change also pro­posed amend­ments to the PSE rules gov­ern­ing trad­ing rights and trad­ing par­tic­i­pants to en­join TPs to abide by the SEC rules gov­ern­ing trad­ing of PSE shares.

The rule also comes with penal­ties of P100,000, P200,000, and P300,000 plus sus­pen­sion of trad­ing op­er­a­tions for at least five con­sec­u­tive trad­ing days for the first, sec­ond, and third and sub­se­quent of­fense, re­spec­tively.

“While we have iden­ti­fied the ap­pro­pri­ate mea­sures to en­sure that bro­ker own­er­ship re­mains below 20 per­cent, we call on our trad­ing par­tic­i­pants to help and sup­port us in en­sur­ing that the le­gal re­quire­ments are strictly ob­served,” Mon­zon added. /